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Daily news and analysis about the food tech revolution

ghost kitchen

800 Degrees Teams Up With Reef, Plans to Open 500 Ghost Kitchens

Here’s some ghost kitchen new math for you: 800 degrees + 1 Reef = 500 ghost kitchens.

That’s at least according to Restaurant Business News, which is reporting the two companies have teamed up with plans to open 500 ghost kitchens. That’s a massive ghost kitchen land grab, of course, the kind that sounds good in a press release but will take huge amounts of capital to deploy.

Not that Reef has had problems raising capital. Last year, the company announced an eye-popping $700 million raise, in which it said it had plans to grow its ghost kitchen network. Still, a 500 ghost kitchens build-out for one restaurant chain will take hundreds of millions in capex, especially since the Reef model is to build dedicated kitchens to power new virtual restaurants. This model contrasts with the Virtual Dining Concepts or NextBite’s operating model which utilizes excess kitchen capacity in small restaurants or even chains to deploy new virtual brands.

Early Reef buildouts were in the company’s parking lots (Reef’s original business), but recently the company has gotten more creative, adding new kitchens in warehouses, retail stores and shipping containers.

The news isn’t 800 Degrees only push into the pizza business future. The company announced recently it’s teaming up with Piestro to deploy up to 3,600 automated pizza kiosks. All it has to do now is combine the robots with the dark kitchens a la PizzaHQ to create a fully robotic pizza chain.

Kroger and Kitchen United Partner to Bring Ghost Kitchens to Grocery Stores

Kitchen United (KU) will expand its ghost kitchen network to include Kroger locations thanks to a just-announced partnership between KU and the grocery retailer. KU kitchens will be located at various Kroger locations, the first of these being at a Ralphs in Los Angeles slated to open this fall. 

Participating Kroger stores will house a KU location that includes “up to six local, regional or national” restaurant brands, according to today’s press release. Customers can order meals from these restaurants via the KU mobile app or onsite at a self-service kiosk. They will have the option to bundle items from different restaurant concepts together into a single order, a concept that KU’s Chief Business Officer Atul Sood recently said was technically complex but extremely important to the future of online ordering.  

While customers can choose to have their meal delivered (via KU’s third-party delivery service partners), the bigger appeal here might be the pickup option. Since the kitchens will be located onsite at stores, Kroger customers can order food while they shop for groceries and simply pick their meal up at the end of their trip.

The partnership is another example of the lines between the restaurant ghost kitchen and the grocery store fading. A year ago, Euromonitor predicted such a shift would happen. In keeping with that, the last several months have seen companies like GoPuff, Ghost Kitchens, and Food Rocket launch initiatives that sit squarely between the grocery and the ghost kitchen.

Moving towards this gray area is intentional on the part of KU. “We are proud to have launched a number of successful ghost kitchen centers across the country, and now we are applying our experience and taking steps to expand in non-traditional ghost kitchen formats such as retail shopping centers and food halls like our newest kitchen center location in Chicago alongside our efforts with Kroger,” Sood noted in a statement. 

He added that KU’s tech stack is an important part of this setup and can optimize “any kitchen setting for streamlined and profitable off-premise business.”

More KU-Kroger locations are planned for the coming months. In the meantime, those interested in learning more about ghost kitchens and the ghost kitchen tech stack can tune into The Spoon’s Restaurant Tech Summit on August 17. The virtual event will feature KU’s CTO Jessi Moss along with many other restaurants, tech companies, and thought leaders in the restaurant space. Grab a ticket here.

Hosted Kitchens Raises €1.25M Seed Round for its Ghost Kitchen Network

Hosted Kitchens, an Ireland-based network of ghost kitchens, announced today that it has raised a €1.25 million (~$1.48M USD) Seed round of funding. In a message sent to The Spoon, Hosted Kitchens CEO Sean Murray said the round was funded by Irish private investors.

As its name suggests, Hosted Kitchens builds out multi-kitchen properties and software for other restaurants to rent to fulfill online orders. The company places its facilities in high-volume locations. Its software can process orders from multiple third-party delivery services such as Just Eat and Deliveroo.

Hosted Kitchens’ fundraise comes as the ghost kitchen space has been evolving over the past year as what a ghost kitchen is and where it’s located continues to change. For instance, third-party delivery service DoorDash expanded its own ghost kitchen program in California last week. We’re also seeing the new wave of speedy grocery delivery services like Gopuff and Food Rocket launch their own ghost kitchen programs, blurring the line between food retail and restaurant. We’ve also seen QSRs get into the ghost kitchen game with Burger King launching its own ghost kitchen in the UK. And ghost kitchens are starting to pop-up in new settings, such as C3’s move to bring ghost kitchens into residential buildings.

For it’s part, Hosted Kitchens says it will use its new funding to continue rolling out to new locations in Ireland and expand into the U.K. The company will also continue to hire out, growing its team from 4 to 20 over the next year.

Gopuff is Hiring to Get Into Ghost Kitchens

It looks like Gopuff, which is best known for ’round the clock, half-hour grocery delivery, is expanding into the ghost kitchen business. According to HNGRY (subscription required), Gopuff is hiring more than 100 cooks, managers in states across the country including Arizona, Texas, Florida and Pennsylvania to be a part of its new ghost kitchen endeavor (hat tip to Grocery Dive).

A job description for a Kitchen Associate in Chandler, Arizona on Gopuff’s site reads:

As a member of Gopuff’s new Fresh Food & Local team, the Kitchen Lead role is crucial to contributing to the success of Gopuff Fresh & Local by leading and managing a vertically integrated ghost kitchen.

Ghost kitchens are commercial kitchen facilities without dining rooms that restaurant brands can rent out to create delivery-only concepts. Meal delivery and takeout, of course, have risen in prominence over the past year as the pandemic forced the closure of dining rooms across the country.

Gopuff, which has micro-fulfillment centers in 650 cities in the U.S., raised a whopping $1.5 billion in funding earlier this year and acquired fleet management company RideOS last month. The general thinking at the time of that acquisition was that RideOS would be used as part of its core grocery delivery operations. But as Grocery Dive points out, that same feet management technology could also be used for routing restaurant meal deliveries.

The ghost kitchen space has certainly been a hotbed of activity over the past year with a number of players launching and expanding services. But perhaps what is more interesting about Gopuff’s hiring spree is the latest example of the lines between restaurant, grocery retail and ghost kitchen blurring. DoorDash, which started out as a restaurant delivery service, launched its own ghost kitchen and is expanding further into grocery delivery and expanding it own dark delivery only Dash Mart stores. Walmart is doing virtual food courts via ghost kitchens. And ghost kitchen operator C3 is running ghost kitchens out of hotels and residential spaces.

For Gopuff, adding hot meals to its existing grocery delivery business makes sense, given that it aims to complete deliveries in a half-hour. In that short amount of time your restaurant food arrives hot, while your pint of ice cream stays cool. Now the onus is on Gopuff to communicate clearly what it’s brand proposition is, so people will order both from the company.

Voice bots and Back Office Tasks: A Mid-year Look at Restaurant Tech

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As we’re fond of saying lately, last year’s pandemic-induced chaos accelerated the restaurant industry’s adoption of technology so much that about a decade’s worth of changes happened in the span of a couple months. Investor, restaurant tech guru, and friend of The Spoon Brita Rosenheim highlighted that point recently when she released her 2021 Restaurant Tech Ecosystem Map. 

The map, while not exhaustive, includes a staggering number of companies across many areas of the restaurant business, from ordering and delivery tech to back-office tools, business intelligence, corporate catering and ghost kitchens. Even a casual glance shows just how enormous (or bloated, depending on your point of view) the restaurant tech sector has gotten over the last 18 months. 

Brita has her own takeaways and predictions bundled with her map, and you should definitely read through them if you are interested in learning more about restaurant tech’s near-term trajectory. Here, I’ll add a few of my own thoughts to the mix, including:

Rise of the voice bot. This is one category that’s slowly but steadily grown a presence in the restaurant industry over the last few years. But excepting maybe Domino’s chatbot, widespread voice-tech implementations at restaurants are still rare, though that will likely change in the next couple of years. McDonald’s threw heat on this topic last month by announcing it is currently testing automated ordering via voice tech at 10 locations, and that it expects this technology to be in all of its locations within the next five years. Meanwhile, the current labor shortage has left restaurants scrambling to make their operations more efficient. If correctly executed, going fully autonomous with the order process could shave seconds off every individual customers’ order. And those seconds (and costs) add up fast. 

The analytics opportunity. Marketing analytics for restaurants are another “it” category at the moment, if its slice of the restaurant tech pie above is any indication. In the words of Adam Brotman, CEO of Brightloom, online ordering tech has become “a commodity,” and that the next big frontier for restaurant tech is around analytics. When Brotman and I spoke a few months back, he explained that data — about customer preferences, transactions, order histories, etc. — is a huge opportunity for restaurants if they can figure out how to harness it. Seeing as that’s no small feat technically, a huge number of analytics and CRM companies have cropped up offering solutions to smaller businesses that can’t build these programs in-house. Expect more companies and much consolidation in this category.

Back-office bonanza. The sizable slice back-office tech gets in Brita’s market map reflects a trend we’ve written about before: that investment and interest in back-office tasks will continue to attract attention in the coming months. The back office was probably once the most “un-sexy” area of restaurant tech, since most of it has to do with digitizing invoices and schedules and helping businesses run payroll. One pandemic later, restaurants are trying to save on costs in as many areas as possible, and a surprisingly effective way to do that is through digitizing, centralizing, and streamlining some of these previously boring tasks. Like analytics, this category will see a wave of consolidation in the future, and in fact that is already happening.

As always, I welcome your thoughts on my thoughts, now and in the coming months as restaurant tech continues to evolve.

More Headlines

Local Kitchens Raises $25M for Its Virtual Food Hall Network – The ghost kitchen/virtual food hall, started by three ex-Doordash employees, has raised Series A funding roughly one year after launching.

Mobility Service Helbiz Opens Its First Ghost Kitchen – Italian-American mobility company Helbiz announced today it is launching its own ghost kitchen/food delivery/virtual restaurant business called Helbiz Kitchens.

Miso and Lancer Worldwide Aim to Automate Beverage Dispensing for QSRs – Miso announced a partnership with Lancer Worldwide, a global manufacturer of beverage dispensers, to develop an automated, intelligent system designed to speed up and organize drink orders.

Mobility Service Helbiz Opens Its First Ghost Kitchen

Italian-American mobility company Helbiz announced today it is launching its own ghost kitchen/food delivery/virtual restaurant business called Helbiz Kitchens. The concept will initially be available to customers in Milan, Italy, with plans to open additional locations in the U.S. and Italy in the future.

Helbiz’ main service is operating fleets of e-scooters, e-bikes, and e-mopeds customers can rent on demand via the Helbiz app. Service is available in Italy, Washington, D.C., Atlanta, Miami, and a few other U.S. cities. 

The Milan operation of Helbiz Kitchens is housed in a 21,500-square-meter (roughly 23,000 square feet) facility and offers customers a choice of six different menus: pizza, sushi, salad, burger, and ice cream. Customers order and pay via the Helbiz app and can bundle different items from each menu into a single order and payment transaction. 

Couriers, known in the company as “Helbiz Butlers,” will deliver the food using the company’s own electric scooters, which makes sense, given how many of these it currently has in Milan and other cities. The setup is similar in some ways to DoorDash Kitchens, a ghost kitchen operation in Northern California that uses DoorDash couriers to deliver meals to customers from Chick-fil-A and other restaurant chains. Crave Collective, a ghost kitchen/virtual food hall based in Boise, Idaho, also employs its own fleet, despite never having pre-existing mobility infrastructure like DoorDash and Helbiz.

Unlike the other two concepts, however, Helbiz’ food concepts are entirely in-house creations and its team of chefs is entirely employed by the company, not a third-party restaurant. The company’s tech stack, which will power everything from online ordering for consumers to fire times in the kitchen and driver tracking, is also the product of an in-house IT team. 

Part of this focus on keeping things in-house is related to economic recovery. Like most other places, Italy’s economy suffered greatly during the pandemic and is now slowly trying to rebuild. Helbiz says its new ghost kitchen operation will provide 80 new jobs for this first location in Italy, with more to come as the concept expands to other parts of the country.

Service will initially be available, as of today, from 11:30 a.m. to 11:30 p.m. Additional locations are planned for Washington D.C. and other cities in Italy in the future. 

Virtual Restaurant Company Curb Raises €20M

Stockholm, Sweden-based ghost kitchen startup Curb announced this week it has raised a €20 million (~$24.4 million USD) round led by Point72 Ventures (h/t tech.eu). EQT, an existing investor, also participated in the round. Curb has now raised €23.2 million to date.

Curb is only a little over one year old, having been founded in May 2020 by ex-Delivery Hero employees Carl Tengberg and Felipe Gutierrez. The company raised an initial €3.2 million in December of last year, which went towards helping the company expand its delivery-only restaurant brands’ presence.

Curb operates what’s essentially a virtual food court, with many of the items meant to evoke street food. It’s collection of delivery-only restaurants include a Mexican-American concept, a burger restaurant, salads and bowls, and chicken wings, among other offerings. All concepts, menus, food preparation, design, and other branding elements are created in-house. Curb also operates its own tech stack. While specific details are not widely available publicly, the company has said it prioritizes data tracking and analysis to improve operations across its supply change as well as monitor customer demands and alter menu items accordingly. 

The company’s operation currently serves customers in Stockholm and Copenhagen, Denmark. Customers of Curb can order via a number of third-party delivery services that differ based on availability in a given location. Orders are prepped and fulfilled in ghost kitchen locations.

Taster, headquartered in London, U.K., is probably Curb’s nearest competitor in terms of what it offers. Like Curb, Taster has its own portfolio of virtual restaurants. Order prep and fulfillment is done in house, and items are available via third-party delivery platforms. The company raised $37 million at the beginning of May. In the U.S., a company called C3 offers a similar model to both Curb and Taster, with restaurant tech company Lunchbox powering the back-end technical capabilities of its virtual food hall.

Curb, meanwhile, says it will use its new funds to further develop its tech stack and grow its overall operations. 

KitchenGrowth Raises Seed Round, Launching Ghost Kitchens in Stockholm in July

While the UK, France and Germany have hotbeds of startup activity in the ghost kitchen and virtual restaurant space over the past couple years, Sweden and the bustling Stockholm innovation ecosystem has been relatively quiet when it comes to new restaurant tech startups.

A new ghost kitchen startup called KitchenGrowth hopes to change that. The company, which raised 1.5 million Swedish krona (approximately $180,000 USD), has plans to build and rent its multi-tenant kitchens in the Stockholm market.

According to cofounder Joakim Ödlund, the company will own the units and offer them as fully managed dark kitchens to operators via a kitchen-as-a-service model. The company will offer turnkey operations that include electricity, water, grease collection as well as Wi-Fi and some technology integration/assistance. According to Ödlund, the company will not create any of its own branded concepts and will focus on supporting its restaurant customers’ virtual efforts.

Ödlund told me the KitchenGrowth has already secured its first customer in Svenska Brasserier, a large multiconcept restaurant operator in Stockholm that runs some of Stockholm’s most well known restaurants such as Riche, Sturehof, and Taverna Brillo. KitchenGrowth will launch its first two locations starting in July.

While KitchenGrowth was only founded in February of this year, the founders have big plans. “Our goal is to put up growth hubs where we can have 4-8 kitchen spaces in one location,” said Ödlund. “We want to help bring down the delivery times and create a “Food court in the cloud.””

Burger King Launches a Ghost Kitchen Initiative in the UK

Burger King said over the weekend it is trialing its first-ever delivery-only restaurant, a location in London, UK that opened on Sunday. The burger chain said this new venture has the potential to reach over 400,000 customers in the North London area.

For its first delivery-only initiative, Burger King has partnered with FoodStars, the commissary kitchen company bought by Travis Kalnick’s CloudKitchens back in 2019. Customers will be able to order meals for delivery via third-party service Deliveroo. Service from Just Eat and Uber Eats will be available soon, too. 

The expansion to delivery-only service comes just as the UK is in the process of opening back up. From today (May 17), restaurants, cafes, pubs, and bars in England, Scotland, and Wales are finally allowed to serve customers inside, with certain restrictions around social distancing and the size of groups. But while consumers will no doubt flock back to restaurant dining rooms, food delivery is expected to remain a popular option for many. This is less about a fear of the dining room and more about new habits getting established during COVID-19-related lockdowns. Many consumers who had never before ordered delivery got comfortable with the concept during the last year or so, and will continue that behavior for the long term.

Burger King is one of many major QSR chains responding to this change. Chipotle announced its own ghost kitchen initiative in 2020, for example. And many chains are redesigning overall store designs to accommodate more off-premises formats. On its recent earnings call, Wendy’s said 30 percent of a planned 1,200 new locations will be “nontraditional units,” a label that includes delivery-only locations and ghost kitchens. Like Taco Bell and Burger King, the chain has introduced new store designs that feature little or no dining room space.

Burger King has not yet said if its ghost kitchen initiative will expand to other UK locations and eventually to other countries. Presumably, the chain will first test the success of this endeavor before announcing any new delivery-only locations.

Cloud Software for Cloud Kitchens: Grubtech Raises $3.4M

Dubai-based Grubtech announced today it has raised $3.4 million in pre-Series A funding for its software platform that powers ghost kitchens and delivery-only restaurants. Investors in the round are unnamed but include “large regional family offices, a U.S.-based venture capital firm as well as reputable angel investors.” 

Grubtech says its cloud-based software platform is built specifically for cloud kitchen operations or restaurants running multiple brands, virtual or otherwise, out of a single kitchen. There are plenty of both nowadays, the pandemic having forced many restaurants to serve the bulk of their meals as delivery or pickup orders. The resulting uptick in both ghost kitchen spaces and virtual restaurants run from underutilized kitchens mean restaurants must now juggle even more order channels than before the pandemic. 

Grubtech’s product promises to simplify operations by centralizing important tasks and information on a single dashboard in the restaurant. For example, instead of a restaurant staffer having to manually input different orders from different virtual brands into the main system, Grubtech automates that process. If a restaurant needs to update a menu item, they can do so via Grubtech, which will ensure every copy of the menu across every order channel gets the same update. Restaurants can also view all sales, integrate with some third-party delivery providers, and, for an additional cost, add things like a branded website or “contactless” dining room app. The company says its software reduces the “click-to-doorbell” time for an order by 20 percent and saves “approximately” 25 percent on labor costs.  

Current customers include a number of companies in the Middle East-North Africa region, such as Delivery Hero’s kitchen in Abu Dhabi and Dubai-based iKcon.

If 2020 was the year ghost kitchens became a mainstream concept, 2021 will be about making them more efficient, and simplifying the tech stack is one way to do that. Centralizing restaurant order channels and data isn’t a new phenomenon (see Ordermark, Lunchbox, and others), but it will get fine-tuned for ghost kitchens and virtual restaurants as more restaurants adopt those channels.

Grubtech said today it will use the new funds to further develop its product and expand farther across the Middle East-North Africa region as well as Europe and the Americas.

Female-Founded Commerical Kitchen Nimbus to Open in NYC

Nimbus, a commercial kitchen space for food businesses of all types, is set to officially open on January 11 in New York City. With it, the company’s founders, entrepreneurs Camilla Opperman and Samantha Slager, aim to provide a space for restaurants struggling from both the pandemic and high cost of rent in NYC.

To learn more about Nimbus and its upcoming launch, I spoke with Opperman and Slager this week. The two said they were inspired to provide an “on-demand” kitchen space to support restaurants and start-ups in their city, but also wanted to go above and beyond the standard ghost kitchen concept.

Nimbus offers a variety of flexible lease and rental options that allow food businesses to control how much they are spending on rent per month. A restaurant or food entrepreneur can rent space at Nimbus for a range of different time periods, from a few months to just a few hours. They can also choose a longer-term lease if desired. Space in the facility costs $20/hour for the prep-only kitchen and $35/hour for the shift-kitchens with a 20-hour minimum per month for both. The Nimbus model also allows businesses to use a convenient online dashboard to book kitchen time, rent storage space, pay invoices, and store permit and insurance information. The kitchen spaces are fully stocked with appliances, saving the food businesses money in start-up costs.

Since ghost kitchens are very much a “back-of-house” operation, what goes on inside them is never really witnessed by customers. To deviate from this and provide more transparency into its operations, the Nimbus facility will also include a front-of-house community space and show-kitchen. These spaces can be used for cooking demonstrations, community events, and workshops, Nimbus said.

The first Nimbus location will host a variety of both existing restaurants and food startups. Roberta’s Pizza (wood-fired pizza), Quinn (a meal delivery service), Alchemista (offers catering and food locker services), Brooklyn Batched Cocktails (pre-made batch cocktails), and Munch Hours Inc (a catering company) are just a few of the businesses that will start using the commercial kitchen space on January 11. Businesses using the space will partner will existing food delivery companies such as DoorDash and Caviar.

As ghost kitchens become more popular — Euromonitor predicted last year the market could be worth $1 trillion by 2030 — different types are emerging that deviate from the traditional commissary a la Kitchen United or Zuul. Nimbus’ concept provides not just an opportunity for restaurants looking for shorter-term leases, but also a way for non-restaurant food businesses to take advantage of the growing ghost kitchen concept.

Nimbus’ cofounders said they are currently looking into opening two new locations in different areas of New York City. The company also has plans to expand nationwide in the next five years, starting in major cities such as Los Angeles and Miami.

Crave Raises $7.3M to Expand Its Virtual Restaurant/Ghost Kitchen Concept

Crave Hospitality Group, which runs the Crave Collective ghost kitchen/virtual restaurant facility in Boise, Idaho, announced today it has raised $7.3 million in seed funding. The round was led by VC firm StageDotO with participation from Capital Eleven and undisclosed individual investors.

Crave said in a press release sent to The Spoon that it plans to use the funding to “build pre-opening teams” for its next four Crave Collective locations, which will open in 2021. 

The company is a relatively new player to the ghost kitchen and virtual restaurant space, having opened its Boise, Idaho facility in November of this year. That facility houses 16 restaurant concepts, many of them focused on recreating upscale dining for the virtual restaurant era in which we now find ourselves.

Like other operations in this space, Crave and its restaurant teams process orders digitally, prepare them in designated kitchen spaces for each restaurant, and put them in the hands of delivery drivers to go out to customers. Unlike other operations, Crave employs its own W-2 staff to do the driving, calls those people “mobile servers,” and treats them more like restaurant servers than gig workers. The company also built its own proprietary tech stack to manage the orders, and as we saw when Crave gave us a virtual tour of its Boise facility last week, the location also includes a pickup area for customers that don’t want to pay the extra cost of having food delivered. 

All those factors make Crave stand out among competitors in the increasingly saturated ghost kitchen and virtual restaurant markets. Clearly investors think so too, hence this seed funding round.

Crave has an additional 10 more facilities planned for 2022. Among the cities the company will expand to are Salt Lake City and Provo, Utah, Mesa and Chandler, Arizona, the Dallas-Fort Worth area, and Denver, Colorado. Crave said in today’s press release that “nearly all” of its current restaurant partners will grow along with the company as it opens more locations.